Buy Balkrishna Industries, target price Rs 1937: ICICI Securities

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Buy Balkrishna Industries, target price Rs 1937:  ICICI Securities


has buy call on with a target price of Rs 1937. The current market price of Balkrishna Industries Ltd. is Rs 1633.

Balkrishna Industries Ltd., incorporated in the year 1961, is a Large Cap company (having a market cap of Rs 31050.61 Crore) operating in Tyres sector.

Financials
For the quarter ended 31-12-2020, the company reported a Consolidated Total Income of Rs 1563.84 Crore, down -2.14 % from last quarter Total Income of Rs 1598.07 Crore and up 31.81 % from last year same quarter Total Income of Rs 1186.41 Crore. Company reported net profit after tax of Rs 325.07 Crore in latest quarter.

Investment Rationale
The brokerage expects healthy FCF generation of ~Rs20bn over FY22E/FY23E even after factoring in Rs20bn of capex over the same period. The brokerage maintains target price of Rs1,937 (unchanged target PE multiple:22x FY23E).


Promoter/FII Holdings
Promoters held 58.3 per cent stake in the company as of Dec 30, 2020, while FIIs held 15.5 per cent, DIIs 15 per cent and public and others 11.2 per cent.



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